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Crowdsourcing: A Definition

I like to use two definitions for crowdsourcing:

The White Paper Version: Crowdsourcing is the act of taking a job traditionally performed by a designated agent (usually an employee) and outsourcing it to an undefined, generally large group of people in the form of an open call.

The Soundbyte Version: The application of Open Source principles to fields outside of software.

The Rise of Crowdsourcing

Read the original article about crowdsourcing, published in the June, 2006 issue of Wired Magazine.

June 15, 2006

Pure, Unadulterated (and Scalable) Crowdsourcing

I’ve been wanting to give a more in-depth treatment to the T-Shirt company Threadless.com ever since I first encountered them in the course of researching my Wired article on crowdsourcing. Threadless didn’t quite fit within the original parameters of how we were defining crowdsourcing at the time, but under my expanded definition they comprise an almost pure expression of the model. For those of you who aren't part of Generation C, or spending your free time cruising Myspace, Threadless is a perpetual, online T-Shirt design competition. Artists submit their designs; users vote on them; the highest-rated designs are printed and sold back to the community. Simple. Brilliant. Most importantly: Ridiculously cost-effective. When I talked to him this morning, Threadless Creative Director Jeffrey Kalmikoff told me the company is selling 60,000 T-Shirts a month, has a profit margin of 35 percent and is on track to gross $18 million in 2006. This, for a company with fewer than 20 employees. Crowdsourcing can be very good business indeed.

I have two excuses to look more deeply at Threadless’ model today. The first is provided by a post on (Wired editor-in-chief) Chris Anderson’s Long Tail blog on scalability. The general thesis, which fits neatly into his broader ideas on the Long Tail, is that digital businesses can serve niche-markets as easily as they serve mass-markets. Chris rightly points out that crowdsourcing has the potential to be a crucial factor in a company’s ability to do so. I thought it would be interesting to examine Threadless in this regard: Because it “employs” a workforce of thousands, the cost of procuring additional creative is nominal (winning designers receive $2000, and sacrifice all rights to their design in the process). Over roughly five years Threadless has acquired 500 designs on their virtual shelf, about 15 percent of which have been reprinted in response to demand within Threadless' 350,000-strong user community.

Here's where it gets interesting: Threadless has a bulk deal with their printer, which means that it doesn't pay a premium for small print orders. The per-unit cost of producing 15 shirts is the same as 1,500. They could theoretically create a significant business servicing those 15 customers that really want to bring the "cowmouflage" design out of retirement. However, according to Kalmikoff, Threadless only prints orders of 1,200 as a matter of principle: "The whole point is that the community" – as a whole – "determines what's sold." On one hand, it's just this aspect of Threadless' model that makes them such a pure example of crowdsourcing: They're not just generating their core product via crowd labor, but they're using the crowd to determine what product lines are sold, a la Rule 5 from my article. Admirable in democratic principle and elegant in execution, it also raises the specter of the tyranny of the crowd. (Ever notice how many pages of dumb pet tricks and scantily-clad teens one must wade through on YouTube's most popular section to find a watchable video?) And it also illustrates how crowdsourcing can work against Long Tail business models.

On the other side of the scalability question, the company has turned down offers from Target and Urban Outfitters that would have resulted in instant growth for the company. "We decided we were already infinitely scalable," says Kalmikoff, who notes that 99 percent of their sales are through their Web site. "We didn't need a brick-and-mortar presence." And they didn't. If their current rate of growth continues, their '06 revenues will represent a 300 percent growth over those from last year.

My second excuse for writing about Threadless is to clarify the ways in which "the crowd" effectively segments into more specialized aggregations of people depending on the crowdsourcing application. Yesterday I taped an interview for the nationally syndicated public radio show "Here & Now." Joining me was Dr. Alpheus Bingham, the President and CEO of InnoCentive, the network of scientists that played a prominent role in my Wired story. He pointed out to the host that characterizing the 90,000 members of InnoCentive's community as "hobbyists" is inaccurate. Many are highly accredited scientists working at world-class institutions (though others do in fact work from their garage.) Likewise, some of the most successful Threadless designers are duly employed graphic artists with academic training in their craft. I thought it'd be instructive to point people interested in this issue (and it's been coming up a lot) to the designer interviews on Threadless.com's site.

Perhaps it's unwise of me to problematize my own blog's tag line – "The Rise of the Amateur." But what the interviews clarify is that both InnoCentive and Threadless networks create a level-playing field on which amateurs and professionals compete on the basis of their merits, not pedigrees. As the Threadless interviews bear out, the amateur often outperforms the professional.

amazing post about On the other side of the scalability question, the company has turned down offers from Target and Urban Outfitters that would have resulted in instant growth for the company. thanks for sharing!!

While the ad slippage is clearly sparked by the country's economic woes, many advertisers are abandoning the Oscars because of its steady ratings decline. As the ratings slide, so do the ad buys. According to current estimates, ABC could have a 15% drop from last year's estimated $81.1-million ad take. MediaWeek quotes Brad Adgate, an aptly named research executive at Horizon Media who was bearish on all awards shows. As he bluntly assesses the problem: "The shows are too long, and too much time is spent on the less prestigious categories." He added that the Oscars now have a median viewer age of 49.5 years, which puts it outside the target 18-49 audience most advertisers seek.

he United States Senate this morning approved their health care legislation 60-39. The bill was approved by 58 Democrats, one socialist, and one Lieberman; all Republicans voted against, except Kentucky's Jim Bunning, who was not present for the vote.

As a piece of policy, it is assuredly imperfect, although some of the conservative and liberal criticisms alike have been based on misinformation and half-truths. It is principally a coverage bill, expected to extend insurance to 30 million Americans, rather than a cost-containment one, which would probably have required more fundamental alterations to the status quo's employer-based insurance system.

Crowding stress can also be interpreted at the molecular level: molecular crowding promotes aggregation of various macromolecules and causes profound changes in numerous physico-chemical parameters of their solution.

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Thanks for sharing .Keep posting articles like this.A good example of content presentation.A piece of information from you every now and then is really great.Great article post.I appreciate your writing skills.They are excellent.The knowledge of the subject is pretty good.To post an article on any topic it takes a great effort and knowledge to have proper knowledge of the niche.

The general thesis, which fits neatly into his broader ideas on the Long Tail, is that digital businesses can serve niche-markets as easily as they serve mass-markets. Chris rightly points out that crowdsourcing has the potential to be a crucial factor in a company’s ability to do so

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Thanks for the constructive feedback :) regarding the Overworld limitations and linearity, I only felt it limited in the sense that you aren't truely able to 'explore' fully in the way that could in other Zelda games - remember the underground caverns you could once find? - and quite frankly I miss that and it is basically linear in the sense that your destination is already chosen, yes you are still exploring and in a wonderful new way but this Overworld 'Transport' also highlights the limitations of what Nintendo can do with a 3D Zelda game on the DS but what they 'have' achieved is still impressive and I do acknowledge that fully.